The Asian Development Bank (ADB) and Gulf SRC have signed a $227.7m loan agreement to finance the construction and operation of a 2,500MW combined-cycle power plant in Chonburi Province, Thailand.
Gulf SRC is owned by Independent Power Development, a joint venture between GED and Mitsui, Japan. The total project cost is expected to be approximately JPY170bn ($1.49bn). Mitsui will have 30% equity participation.
ADB signed the agreement for the Chonburi natural gas power project with co-financiers – the Japan Bank for International Cooperation and 10 international and local commercial banks.
The project is based on a long-term PPA with state-owned power utility, the Electricity Generating Authority of Thailand (EGAT).
Touted to be one of the largest power plants in Thailand, the facility will utilise natural gas as a resource. It will also be the first in the world to employ a new high-efficiency technology that will reduce pollutants and emissions, improve air quality and produce a lower carbon footprint.
The plant will consist of four units of 625MW. The plant will be fuelled by natural gas, including imported LNG through the long-term gas sale agreement with PTT.
ADB deputy director-general for private sector operations Christopher Thieme said: “Increased capacity for power generation is essential for rapidly growing countries like Thailand as energy demand will continue to rise.
“ADB’s financing of Gulf SRC will support the creation of a cleaner and more affordable source of energy generation in Thailand.”
The Eastern Economic Corridor (EEC) programme of the Government of Thailand is intended to be the country’s main economic growth driver over the next decade and the Chonburi plant is expected to help produce the growth and industrial transformation under the EEC programme.
Work on the project will begin before the end of 2018 and the power plant is expected to be fully operational by 2022. It will be one of the first mid-merit plants in the corridor. It will adjust power output depending on demand for electricity on a given day.
For the first time in the world, the plant will use the combined-cycle gas turbine technology, which has maximum rated thermal efficiency greater than 63%, ADB said.
The project will also help Thailand avoid 737,000 tonnes of carbon dioxide and provide employment to the local population, including women.
Gulf Energy Development (GED) CEO Sarath Ratanavadi said: “This project is important as it will help produce the growth and industrial transformation that is expected under the Government of Thailand’s Eastern Economic Corridor (EEC) program.
“We appreciate ADB’s leadership in mobilizing the finance to make the project possible.”
Image: The Chonburi natural gas power project site in Thailand. Photo: Courtesy of MITSUI & CO., LTD.